The Cryptocurrency Genie is Out of the Bottle

I’m typically very interested in innovation, especially the disruptors. A couple years ago in a bout of attention disorder, I ended up stumbling across Bitcoin while researching anonymous proxies and VPN. At one point, I toyed with the idea of buying some ASIC machines and setting up a mining operation in Iceland where the electricity is inexpensive – just kidding. In 2013, the Bitcoin exchanges documented crazy volatility and critics pointed out that Bitcoin is used for nefarious purposes – Silk Road. I could easily document far greater use of cash for nefarious purposes and some government controlled, crazy volatile markets that are the origins of the word “Bubble”.

I believe Bitcoin, the first currency that removes the need for a trusted third party in financial transactions is an important disruptor and even if it fails, there will be successors; I have a difficult time seeing a future without Bitcoin or something like it (Ripple). Analogous to Napster’s push on P2P file sharing, Bitcoin is blazing a trail for how currency can be separated from certain external factors; distributed, borderless, digital currency that can be micro managed and is inherently deflationary. With no central source to control, regulation or manipulation, Bitcoin is free from political consideration that influences fiat money. Bitcoin users get to send money anywhere in the world for a minimum fee, cutting out the middleman. While I doubt it will entirely replace fiat currency, a viable alternative may force changes in the way other currencies operate.